Old materials are leading to new innovations for LED lighting

Once again it’s good old silicon — the basis for computer chips, cheap solar panels and even next-gen materials like thermoelectrics — that’s leading to some of the most promising innovations for the future of lighting tech: LEDs. Over the past couple of years, companies making light-emitting diodes for lighting using silicon wafers have begun to commercialize these efforts, leading to more and more of these cheaper, efficient LEDs out there.

The core of an LED light is the chip that contains the diodes for converting electricity into visible light. The chip is usually made with a semiconductor compound like gallium nitride, on top of a 2- to 4-inch sapphire wafer. But to lower production costs, some LED chip companies are looking to replace the sapphire wafer with a silicon one. (For more on this market check out Gigaom Research’s report from last year, subscription required.)

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Silicon is one of the most common elements in the world by mass. It’s abundant and relatively cheap, made by heating sand and carbon at high temperatures.

Soraa’s LED lamp, image courtesy of Soraa

Chinese startup Lattice Power, which makes an LED using silicon as the substrate, told the Wall Street Journal’s Venture Capital Dispatch site that it’s sold about $33 million worth of its LEDs in the last year, mostly to lighting users in China, and plans to double that revenue this year and again in 2015. The company boasted that it can sell LEDs for 30 percent below the price that some of the largest LED makers are selling them and still maintain 40 percent gross margins.

Lattice Power’s executive chairman Sonny Wu told the WSJ that the company also just raised $80 million in new equity funding led by Asia Pacific Resources Development with participation by GSR Ventures (where Wu is managing director), Mayfield Fund and Crescent HydePark. On top of the sales and funding, Lattice Power is looking to move into the U.S. to build both an R&D center, as well as a factory. Wu said the company has access to $1 billion line of credit from a regional Chinese bank to fund the U.S. move.

Other companies working on LEDs built on silicon wafers include Germany-based Osram Opto Semiconductors, Bridgelux and Toshiba, Taiwan-based Epistar, and Samsung. GT Advanced Technologies bought a startup called Twin Creeks in 2012 to acquire its ultra-thin wafer slicing tech which can be used on both sapphire and silicon.

Bridgelux’s LED chips, image courtesy of Bridgelux.

Not everyone thinks silicon wafers are the answer, though. Other startups are looking to produce better light by making both the substrate and the semiconductor out of gallium nitride. Startup Soraa, which launched in 2012 and was co-founded by LED pioneer Shuji Nakamura, is taking this approach. According to Soraa, matching the crystal structures of the LED layer and the wafer can lead to blue LED chips that shine brighter and that have more-consistent light.

As we quoted in our LED report (sub. required), the overall LED market is expected to grow from $10.9 billion in 2012 to $13.5 billion in 2015 according to IMS Research. Out of that, the lighting sector was predicted to account for $2.9 billion in 2012 and $5.8 billion in 2015.

And once the households have converted to LEDs, the demand will level or even decrease since these have a much longer life than incandescent or even CFL. If the prices drop significantly, then more homes will convert to LEDs – sooner. I just replaced one in a closet so now I won’t have to climb up on a ladder to change it.